Use the Following to Answer Questions

question 22

Multiple Choice

Use the following to answer questions :
Figure: Revenues,Costs,and Profits for Tomato Producers III
-(Figure: Revenues,Costs,and Profits for Tomato Producers III) Use Figure: Revenues,Costs,and Profits for Tomato Producers III.The market for tomatoes is perfectly competitive.If the market price of a kilogram of tomatoes is $12,in the short run,this farm will:

• A) minimize its losses by shutting down.
• B) minimize its losses by continuing to produce.
• C) break even.
• D) earn an economic profit.

---

Definitions:

Deadweight Loss

A loss of economic efficiency that can occur when equilibrium for a good or a service is not achieved or is not achievable, leading to a misallocation of resources.

Baseball Hat

A type of soft cap with a rounded crown and a stiff bill projecting in front.

Tax

A mandatory financial charge or some other type of levy imposed on a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Marginal Tax Rate

The amount of tax paid on an additional dollar of income, which is typically a percentage that increases as income rises.